STORY OF THE SINO-JAPANESE WAR 379
fruits of her "victory." Another American President may force Japan to disgorge China, but he will not do so and cannot do so until Japan is reduced to the same state of economic exhaustion she found herself in at the conclusion of the Russo-Japanese War, and it is up to the Chinese to create that condition of economic exhaustion in which American and British intervention will become possible
It is not my object here to go into the details of Japanese finance, the heightening Chinese morale, the Chinese guerrilla resistance and the actual conditions of Japan's "occupied areas," which are the essential assumptions for the postulate of a final Chinese victory. The weakness of Japanese finance and its scandalously low gold reserve are well-known to the intelligent western public. Totalitarian measures are good only for domestic finance and do not alter the fact that Japan has to continue to pay with gold and diminished exports for the military and commercial raw material which she must obtain from abroad. Nor can totalitarianism save a state's foreign trade from being ruined in a war.
Equally well-known is the fact of Japan's precarious hold on railway zones, beyond which her troops dare not go out, in the so-called "occupied provinces." Japanese troops are not seen in the countryside of the whole of Shantung and Hopei; the country is ruled and organized by Chinese under the National Government; its magistrates and provincial governors are appointed by the National Government whose authority in Shantung and Hopei to-day is actually firmer than before the outbreak of the war; the Chinese continue to collect taxes, run the post office and banks and market the agricultural output by rural co-operatives; appointees of the puppet government of Peiping are murdered as soon as they arrive at the country; a complete espionage system organized among the peasantry by the Eighth Route Army makes it impossible for traitors to penetrate into their territory; guerrilla activities reach the very walls or outskirts of Peiping, Tsinan, Tientsin and Shanghai; Chinese guerrillas cross and re-cross the Japanese guarded railway lines; repeated wholesale defections occur of "Manchukuo" troops and Chinese Peace Preservation Coips stationed at different cities and armed by the Japanese; cc